Comfort Suites may be getting a new owner

Friday

Oct 26, 2012 at 12:01 AM

Rex Troute

The Comfort Suites Hotel andamp; Conference Center in Burlington is for sale, and Don Sheedy is working hard to buy it.

Burlington Area Hospitality, the Comfort Suites Hotel ownership group that included local investors, was foreclosed on six months ago by McFarland State Bank in McFarland, Wis. The hotel is scheduled to be sold Dec. 4 at a Des Moines County sheriff's sale.

"The reason they ran into trouble is they ran into debt," Sheedy said.

According to the sheriff's sale listing, Burlington Area Hospitality owed $7.7 million on the mortgage to creditors and in legal fees.

Sheedy's firm, DLS Management Corp., has managed the hotel the past six months and has been operating normally during that time. The Ottumwa native has served two stints with Comfort Suites Hotel, first as general manager in 2003.

"I was here during the construction," Sheedy said.

He helped open Fiddlesticks restaurant and the convention center when Comfort Suites Hotel debuted in 2003. His second stint with the hotel started in December 2008 when he became the operations manager. He also leased the restaurant space for his former Roosevelt Avenue eatery - Peaches.

"This has been in the works for about nine to 10 months," Sheedy said of trying to purchase the hotel.

However, he must wait for the Des Moines County sheriff's sale to take place, where McFarland State Bank is expected to buy the hotel. The sale will get rid of the liens on the business, then Sheedy will work to negotiate a purchase price with McFarland State Bank.

Sheedy received some backing at Thursday's executive board meeting of the Southeast Iowa Regional Planning Commission, which approved a $500,000 balloon loan for Sheedy's mission of purchasing the existing business. The 10-year loan has a 3.5 percent interest rate and was funded by two $250,000 revolving loan funds through the Economic Development Administration.

Two Rivers Bank andamp; Trust of Burlington will work with Sheedy to finance the potential purchase from McFarland State Bank after the sheriff's sale. A representative from McFarland State Bank could not be reached for comment.

The project is going to help retain 63 jobs.

"I think it's a great opportunity for Don and the community," said Matt Shinn, market president for southeast Iowa for Two Rivers Bank andamp; Trust. "It brings the ownership back locally and more in tune with the community."

Shinn and Two Rivers Bank and Trust have worked with Sheedy before, when the Burlington businessman opened Peaches.

"At the end of the day, we look at it as a partnership," Shinn said. "We have a huge comfort level with Don."

If Sheedy succeeds in purchasing the motel, he has no immediate plans to remodel the facility.

"The goal is to control costs," Sheedy said.

Nearly all of Sheedy's business experience since he left the Army in 1975 has been in the food and hotel industries. He worked 17 years in the Hy-Vee deli department, first in Ottumwa, then Austin, Minn., and finally in Burlington.

Along with owning his own restaurant, Sheedy also leased the former Wickliff Hotel, now Howard Johnson's, in Burlington for a couple of years. Between his stints with Comfort Suites Hotel, he worked for Catfish Bend Casino.

He also is part of a partnership, Triple S Development, which bought the Stonegate Village apartment complex in Burlington in August 2011.

Sheedy said he has done due diligence to be prepared to purchase the hotel.

"I think Don is the exact right person to manage that project," Shinn said.

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